Diversified Royalty Corp T.DIV

Alternate Symbol(s): BEVFF | T.DIV.DB.A

Consumer Cyclical Auto & Truck Dealerships

Diversified Royalty Corp. is a multi-royalty company. The Company is engaged in the business of acquiring royalties from multi-location businesses and franchisors in North America. The Company owns Mr. Lube, Sutton, Mr. Mikes, Nurse Next Door, Oxford Learning Centres, Stratus Building Solutions and BarBurrito trademark. Mr. Lube is the quick lube service business in Canada, with locations across Canada. Mr. Mikes operates casual steakhouse restaurants primarily in western Canadian communities. Nurse Next Door is North America’s growing home care provider with locations across Canada and the United States as well as in Australia. Oxford Learning Centres is a franchised supplemental education service. Stratus Building Solutions is a commercial cleaning service franchise company providing janitorial, building cleaning, and office cleaning services primarily in the United States. BarBurrito is a quick-service Mexican restaurant chain.

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Diversified Royalty Corp > Article on Air Miles

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Comment by Shirtlessnomoreon Jul 04, 2022 3:32pm

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Post# 34799967

RE:RE:RE:RE:Article on Air Miles

Good insight, air miles here imo is a nothing burger to me, definitely not one of the reasons I'm here. I've never even really focused on air miles with respect to DIV and agree that as time goes on more and more are just doing their own thing with regards to rewards, I've never even had an air miles card and certainly wouldnt want one now. Cheers

TickerTwit wrote: A number of you told me I had no idea what I was talking about when I last posted on this topic. Feel free to do so again.

For a time I did the Air Miles data processing for one of their larger partners. At the same time I was involved in competitive analysis of the unwinding Canadian long-distance market and was able to see the ease with which resellers and rebillers were entering that market -- this is pertinent to Air Miles.

The good news here, if I can call it that, is that the Air Miles royalty deterioration will merely injure DIV rather than kill it. Shareholders will suffer and management will not.
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hawk35 wrote:
I think the Air Miles program will be flat going forward ...

It will not be flat. It's been dying for years. Any company with its own billing system (rather than 3rd party) can set up a rewards program and not have to give Air Miles a cut of it. This is the trend we're seeing now, it will not stop, and the demise of Air Miles will only pick up speed as the ability to retain partners diminishes.

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hawk35 wrote:
...unless DIV can figure out a way to reposition it and make it more attractive.

DIV has no meaningful ability to do this. It's in the hands of Air Miles, and it's a tough sell to potential partners who can do rewards themselves (provided they're willing to invest in the setup of it and take on the risk-to-brand of their new program running into trouble -- this inertial aspect is the only reason Air Miles isn't out of business already).

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hawk35 wrote:
But it is difficult to change the public's perception of the program once a negitive bias has set in.

The public isn't being consulted here. Rexall didn't ask my opinion, nor did Staples. They simply decided they had the tools in-house and would no longer be giving a cut to Air Miles.

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hawk35 wrote:
Anyway it should not be a huge hit to DIV.

Depends on what you consider "huge", but as I stated above, it won't kill DIV's ability to pay executive salaries (which take priority over dividends).

Air Miles is the only royalty purchase by DIV that ever concerned me.